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Updated about 9 years ago,
Buying foreclosures from banks
I just made an offer on a foreclosure to use as a rental. Yesterday, the seller/bank responded with an unsigned counter. I agreed to their suggested price and terms and signed it asking for a quick close. Today, their agent says there is another offer that was placed last night (after I signed the counter) and now they are asking for "highest and best" offer. I am perplexed as to what to do so I thought I would throw it out for discussion. Anyone?
It looks like the bank may have sent you a "Multiple Counter Offer" form. I'm from California so it may be different in your state though. When a bank is asking for your highest or best they may or may not have higher offers than yours. It could be a tactic to increase your price or they really could have a better offer. In this case you just have to decide whether you are still getting a good deal if you increase your price.
- David Friedman
Leave your offer on the table. This is a negotiation technique that plagues on your emotional commitment.
Thanks, I did get a Multiple Offer Notice. My gut is staying stay with what I agreed to, but a little bird is telling me it would be okay to go $1032 (which would be full price plus $32). Tough decision. Either way I will not pay more than it is worth.
If your comfortable with adding $1032 you should do it. I have a question did you write it and offer on your own? Or did you have a realtor submit?
I agree that this is a negotiation tactic which probable does not have any other offer out there. Stick with your original proposal and press them for a decision.
If you really want to turn the tables, then tell them you found another investment and need to resolve one immediately. Tell them that you will retract your offer in 1 day.
Sean, I am a realtor as well.
Steve, good idea. I actually am going to look at another possibility today.
Pamela M. , if you are dealing with a Fannie, Freddy or HUD foreclosure then there probably is another offer, but does not mean it is better than yours.
If your offer for cash? No contingencies? If do, try to find out if the other offer is cash.
Are you getting the buyers agent commission? Does that allow you to comfortably raise your offer a tiny bit?
Percy, Property is bank owned. I offered cash with a quick close and no contingencies. Yes I will get a commission that would pay for the extra $. Thanks for your input.
Pamela M. , just to clarify is the house worth 1032k (i.e 1 million thirty two thousand)?
Oh my no. It is small potatoes. That was $1,032.
In that case I would offer them $1500 and be done with it, IF you want it.
Are you sure you want a $1032 house? What rehab is needed and what would it rent for?
I have offered $44,532, list was 44,500. They are at least 3 other offers and they won't tell me if they are cash or not. It needs about $15K in rehab. I have a renter if I get it.
My problem was that the bank countered my original offer and I agreed but then there were other offers and it became highest and best, which I hate. I usually advise to stand your ground but I went ahead and offered the $44,532 which was $1,032 over the banks counter. So I am waiting for the bank to decide while I look for other properties.